Taxes, tariffs, trade and how the 2020 race could affect your business
The COVID-19 pandemic has strained supply chains for many businesses, often severely, pushing many companies to consider new options, including onshoring. With the election a month away, what difference might a Trump or Biden administration make when it comes to your supply chain?
While some have thought a Biden administration might mean a return to globalization and free trade, Robert Shea, Grant Thornton’s managing principal for public policy, disagrees. “I don’t think trade policy would be vastly different. Both candidates want to strengthen manufacturing in the U.S., both view China as a threat both economically and to our national security, and those facts will drive trade and supply chain policies in either administration.”
But there are significant differences on taxes. “The candidates have very different plans on taxes,” says Brian Murphy, a leader in Grant Thornton’s tax practice. “President Trump wants to cement the tax platform established in 2017 with the Tax Cuts and Jobs Act, which significantly reduced corporate taxes and made major changes on the international tax front, along with other provisions. Biden is looking to raise money for new programs and correct perceived inequities in the Trump tax regime. He’s looking to raise corporate rates and rates on wealthy Americans.” More details on the Trump v Biden tax plans are available here.
Trade and tariff policies also bear watching. “Over the last three years, we’ve seen a lot of trade policy and tariff volatility, causing considerable uncertainty for importers and manufacturers,” says Mike Eder, Grant Thornton’s managing director of US customs services. While Eder doesn’t think Biden would return to the free trade policies of the past, he does think a change in administration would mean a difference in focus, tone and strategy, with increase cooperation with U.S. allies.
The big picture? While companies will have to wait until after the election to know the specifics, Jonathan Eaton, head of supply chain services for Grant Thornton, says it’s time to start weighing your risks and options. “Supply chain risk has been a bigger focus than at any time in my 23 years of consulting,” says Eaton. “COVID-19 exposed supply chain risks for so many companies.” Companies should start now to fully understand the global risk posture so they are ready to react to post-election realities no matter which candidate comes out on top.
Our featured tax insights
No Results Found. Please search again using different keywords and/or filters.